Wednesday, December 17, 2008

Well raise my rates...

Rate hikes shouldn't come as a surprise in our current economy. Somebody has to pay for the improvements that are needed to the system, and since the community has fought so gallantly against growth for the past couple of years... we certainly could not pass that cost on to anyone else but the current users. We are getting what we voted for. It is the price of thwarting new development and further prosperity.

A few bits from the article linked above...

The imposed changes are expected to jump the average residential monthly water bill from $21.24 to $26.08 and the average wastewater bill from $14.44 to $21.37.

It could have been worse I suppose. Probably means one less movie to see a month at the re-opened movie theater (later this week).

But here council responds to development issues...

Included in the new water rate is an extra $2 base-rate increase designed to produce extra revenue to cover the difference if Council decided next month not to raise the city's water and wastewater development investment fees, as recommended by an October study published by the Red Oak Consulting firm.

At a workshop meeting on Nov. 24, Finance Director Coral Loyd presented the study in which Red Oak recommends the city raise its water investment fee for the most common meter size from $1,200 to $3,370, with corresponding increases among larger meters.

Several council members were concerned that such an increase would drive off new development and fail to bring in any new revenues.

Well then maybe they should consider drastically reducing the current fees, since new development is practically a contradiction in terms at the moment. I mean, there isn't a line out the door down at the city to pull permits for new projects today. If the city wants to induce development to help pay for costs... some of something is better than all of nothing.

This goes for other items included on the development investment fees. The community risks nothing by lowering the fees, if indeed the fees in the first place are keeping builders and developers from even proposing projects at the moment. It is just basic economics.

Also...

Vice Mayor Janet Watson said raising rates was not something the Council wanted to do.

But it was necessary to increase revenues to maintain operation and maintenance costs, and to prove to the finance authority that the city could raise enough revenue to pay back the $35 million loan.

Again, the voters over the recent years are getting what they voted for. Increased cost burdens.

And...

Councilwoman Robin Gordon noted, however, that the infrastructure would have to be paid for whether new growth occurs or not. She said new growth, especially consistent growth, was not a guarantee in the current economic times, and that depending on income from development investment fees could be a recipe for disaster down the road.

Depending on income from development fees is a disaster right now.

"We're ensuring that we have the money to pay for the infrastructure, it doesn't matter if we have the growth or not," Gordon said. "We have no way of knowing how long this current economy's going to go on."

Yep, we don't know how long the current economy is going to go on for... but we could take steps to do something about it. Since we, the community, has to pay for infrastructure no matter what (she is right, there is no free lunch)... it is time to figure out a way to do that that uses our best assets (Interstate 40 for example) in a way that lessens the burdens. Most communities across this country are engaging in public/private partnerships. Let's at least start there to see if a solution can be found.

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